Ferbasa (FESA4) Q4 2024 earnings summary

Executive summary

• Adjusted EBITDA for 4Q24 was R$47 million, down 63% sequentially, while net profit rose 21.9% to R$126.3 million compared to 3Q24.

• 2024 was marked by global geopolitical conflicts, logistics bottlenecks, protectionist trade actions, and inflationary pressures, impacting sales, costs, and pricing.

• Despite adverse conditions, the company prioritized cost control, productivity, and strategic projects, including a new HC FeCr plant and lime plant commissioning.

• Celebrated 30 years of the SILBASA joint venture and continued significant social investments, benefiting over 100,000 people.

• R$138.0 million was distributed as interest on equity (JCP) in December 2024.

Financial highlights

• Net revenue in 2024 was R$2,236.7 million, down 8.1% year-over-year; 4Q24 net revenue rose 1.6% sequentially to R$607.5 million.

• Adjusted EBITDA for 2024 was R$352.0 million (margin 15.7%), a 22.5% decrease from 2023; 4Q24 Adjusted EBITDA was R$47.0 million, down 63.0% from 3Q24.

• Net income for 2024 was R$327.8 million (margin 14.7%), a 14.4% decrease year-over-year; 4Q24 net income rose 21.9% sequentially to R$126.3 million.

• Cash consumption totaled R$39.0 million in 2024; year-end net cash position was R$709.9 million.

• CAPEX reached R$288.7 million, 8.0% lower than 2023, focused on machinery, equipment, and forest assets.

Outlook and guidance

• Market conditions remain challenging with oversupply and price pressure in silicon and chromium alloys.

• Global GDP growth is expected at 2.7% in 2025, with developing economies facing the weakest growth in 25 years.

• World steel production is forecast to recover by 1% in 2025, mainly driven by India; Chinese demand is expected to decelerate moderately.

• Strategic focus on competitive energy, bioreducer supply, and raw material sourcing to support future production.

• The company will focus on cost management, process optimization, and expanding chromium ferroalloy capacity.